India Beats Japan to Become Third Largest Smartphone Market


India has surpassed Japan in the smartphone market, becoming for the first time the third largest in the world behind the US and China, a new report from Strategy Analytics points out.

The first quarter of 2013 alone saw India’s smartphone adoption grow an impressive 163 percent, four times faster than the global average of 39 percent. India also outpaces the rest of the world in year over year sales, with China at 86 percent, Japan at 24 percent, and the US at 19 percent.

The research firm credits better distribution networks from major players like Apple and Samsung for the surge. Local marketers such as Micromax, an Indian mobile company using an Android OEM, also spur that growth.

India’s growth in smartphone adoption is hardly surprising considering its vast population, a growing middleclass, and an increasing popularity of consumer electronics in the country boosted by rising incomes.

As companies like Apple and Samsung reach saturation in American and European markets, emerging economies like India are an enticing opportunity. Total smartphone shipments in Western Europe, for example, have dropped 4.2 percent year on year at 43.6 million units, according to recent figures from an IDC analyst. Apple in particular has suffered in the European market, dropping from 25 percent to 20 percent in the first quarter of 2013. In India, however, its market is growing, reaching a 15.6 percent share in the fourth quarter of 2012, thanks to a more localized distribution strategy.

At the same time, domestic players are outpacing global brands in the Indian market, Strategy Analytics points out. Local providers such as Micromax, Karbonn and Spice have all experienced growth rates between 200 to 500 percent annually. Microvendors like Lemon Mobile, which deal mostly in Android phones, have seen sales jump by as much as 1,000 percent.

“The smartphone boom is well underway. India is now a country no major smartphone vendor, component maker or apps developer can ignore”, the report concluded.